Generation Z has a new side activity: stock trading
In early July, stock market influencer Kyle Fairbanks was banned from TikTok for calling Robinhood CEOs a “bunch of cocksuckers”.
The 23-year-old self-taught investor insists the problem was not blasphemy; that is, he had made a “controversial” statement about the trading app to his 132,000 subscribers.
Fairbanks’ criticism of Robinhood is not unpopular – the company has been under investigation for several reported violations since its decision to bar retail investors from trading during the GameStop short press, to his presumed gamification of the negotiation process.
“I want the best for my subscribers,” Fairbanks told VICE on a Zoom call from Dallas, United States. “When someone comes live on my TikTok and asks me, ‘Is Robinhood a good broker? I’m going to be frankly honest with them: I don’t think so. ”
Fairbanks is one of the last generations of disruptors in the financial world: Generation Z stock gurus.
It was both products and reviews of financial services like Robinhood that made commission-free trading accessible and frictionless, and caused a unprecedented rise the number of amateur traders in the market.
Fairbanks, which is now back on TikTok as @assettrades with 120,000 subscribers, intends to educate new investors so they don’t get exploited.
“The education system doesn’t teach you how to define passive income or invest in stocks, and I think that’s a huge gap,” he said. “I see my mother in trouble; she worked nine to five [job] since she was 24, and now she’s 60. I don’t think it’s okay for someone to have to go above and beyond like that.
Fairbanks learned to invest through online courses, books, and podcasts, and began to invest with the money he earned from various side activities such as personal training and freelance videography. He is now one of the four owners of Asset Entities, “a community of like-minded individuals” that meets on the Discord community discussion platform to discuss everything from potential stock opportunities and opportunities. activities secondary to long-term investments.
On TikTok, where they have over a million subscribers, @assetentities posts videos with taglines like “Stocks That Got Me Out of the Suburbs” and “Stocks That Will Make Me Rich By 2022 “- some of which have received nearly three million views.
It’s easy to be cynical about Gen Z’s decision-making abilities: scrolling through the r / wallstreetbets subreddit, best known for spearheading the GameStop action spike, brings up Publishs which reads: “tl; dr: I put the wrong expiration date for a sell order I did DD on, and basically wasted 3 years of my savings.”
It’s also easy to ridicule the unfounded trust of the memes-era stock trader, who has yet to witness a stock market crash at an auspicious time like millennials in 2008.
However, there’s a lot more to Gen Z’s bull trick than it looks.
“There has always been an element of exposure to investing,” Munich-based insurance expert Patricia Pelayo-Romero told VICE. “The only difference is that Gen Z is getting this exposure through different channels: TikTok, Reddit, and Twitter. It’s especially appealing right now, as their chances of getting a well-paying job are far lower than they were a year ago. The stock market is basically a way to make money.
Take for example Vivian Sam, who once aspired to be a chef. At the age of 19, he enrolled in a hotel management course in the southern Indian town of Bengaluru, but soon realized that the physical and mental strain of being a chef was not for him. Out of curiosity, he calculated the kind of wealth he could hope to generate with income from the hospitality industry.
“It would have taken me almost 40 years to make just a million dollars,” he told VICE.
During his final year on the program, Sam was already reconsidering his career path. Then, in the spring of 2020, the pandemic made the choice for him. He learned about stock trading through online courses on YouTube and started making small investments with saved pocket money.
Now at 22, Sam is a full-time trader, working from his home in the city of Bhilai in the state of Chhattisgarh, India. “I am part of the COVID generation of stock market investors,” he said, identifying himself with over ten million Indians who opened trading accounts between April 2020 and January 2021. “I found it really addicting watching my money grow like this, so I got hooked on trading, and it’s going well.”
Meanwhile, in Switzerland, 22-year-old Santiago Mezzano started trading to take advantage of the market recovery after the pandemic. He borrowed money from his parents and spent his forties short selling all day. “I had no idea what I was doing at the time, but somehow I invested in all the right companies and left at the right time,” he said. he told VICE.
Now, Mezzano is investing for the long term, hoping to worsen his gains over the decades as a safety net for the future. As a psychology student, who will be pursuing a master’s degree in neuroscience in the next semester, he has learned enough about neurodegenerative diseases and the costs of old age to be already concerned about his well-being after his retirement. “Who’s going to take care of me when I’m 80?” ” He asked. “Pension funds will not be viable because no one will be able to pay for them. I will not trust the system. I want to live happily when I retire.
While financial stability is the number one concern for many investors, Elena Broglia sees much bigger things. A 22-year-old entrepreneur based in Milan, Italy, Broglia is developing a platform for people to share and discover products that are produced sustainably and that contribute to a circular economy. With her investments, which she makes with pocket money and the income from her previous jobs, she wants to reflect her commitment to a sustainable future and invest in companies that practice eco-responsibility. “I want to use my money in a targeted way and invest in the ideas of others,” she told VICE.
Broglia perceives a change in sentiment among consumers: more and more people are starting to sponsor companies that practice sustainability, and these are the ones she believes are poised for success in the future.
Yet the feeling is a curious thing. Most Gen Z investors tend to buy stocks in companies they recognize, especially in the technology sector.
However, many investors believe the future lies in the most enigmatic investment strategy of all – cryptocurrency.
Justine Castillo, a 24-year-old language teacher based in the Philippines, first saw the potential for investment in 2017, when the price of a Bitcoin rose to nearly $ 20,000. The crash that followed in 2018 made a lot of people scoff at the legitimacy of alternative currencies, but after the pandemic the market rebounded.
“When the pandemic started, people were saving their money and the savings were suffering from all the lack of production,” said Castillo, who spends a portion of his income each month on investments. “I saw cryptocurrency as a way to protect against fluctuations in fiat currency.”
Castillo isn’t the only one who sees cryptocurrency as a safety net in the event of a stock market crash. Even Robert Kiyosaki, businessman and author of the investment bible Rich daddy, poor daddy, urged people to invest in more “gold, silver and Bitcoin”.
“We still have a long way to go to determine the value of something,” Castillo said. “I don’t think we’ll get to a point where stocks or cryptocurrencies or any sort of investment will escape speculation. We cannot determine the next big crisis or the next big boom. You’re just trying to see into the future.
The concern of insurance expert Pelayo-Romero is that if previous generations – including millennials – generally only invest in the market when they have adequate financial knowledge, Generation Z investors tend to take more risk than they can afford.
Lots of information on “StockTokAs the flow of stock market related content on TikTok is known just isn’t accurate, she says. If people didn’t have the right mentorship, they wouldn’t know it any better. Gen Z does ‘also that saw a post-COVID bull market, and may have developed a misconception of what stock trading can do for them. In the long run, however, the increase in financial literacy is quite positive.
“The more exposure you have, the more proficient you become, like with anything else,” Pelayo-Romero said. “What makes Gen Z so daring is that their situation is bad enough already. So really, they have nothing to lose.
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